Bethesda, MD -- American Capital Strategies, Ltd. (Nasdaq:ACAS) announced today that it has invested $18 million to purchase the Chromas Technologies business from Didde Corporation. American Capital has agreed to invest up to a total of $21 million. Chromas manufactures digital and analog printing presses for the packaging and labeling industry. Together with the Digital Label Alliance, a research and development consortium of flexible packaging manufacturers it organized, Chromas has recently introduced an innovative digital printing press that allows printers to economically produce short runs of high resolution graphics. American Capital's investment is in the form of a revolving line of credit, senior term loan, senior subordinated debt and common stock in a new corporation formed to complete the transaction. American Capital is the lead investor in this transaction and will own over 90 percent of the new corporation.
The Chromas sales force and service operations will be based in the United States. Manufacturing and engineering will continue to operate through a subsidiary based in Canada, as will the research and development team. Included in the transaction is Chromas' interest in the Digital Label Alliance, which has led the research and development of digital technology within the flexible packaging industry.
"American Capital's investment in Chromas is our third manufacturing buyout this year," said American Capital President and COO Adam Blumenthal. "The transaction falls squarely within one of our main lines of business, and speaks to the ability of our principals to form effective partnerships with manufacturing concerns. We anticipate more investments in companies that, like Chromas, successfully develop new technologies on a solid manufacturing platform and with an extensive base of industry relationships."
"American Capital is investing in a company with strong market share in a growing industry and significant competitive advantages," said American Capital Principal John Freal. "Chromas products are flexible, allowing quick set up and integration of multiple printing needs, and the company has positioned itself on the cutting edge of new printing technology with the digital-based line of equipment it has developed. In addition, the company's new management is well suited to bringing Chromas' rigorous manufacturing standards to its relationships with vendors and customers."
"American Capital's investment permits Chromas to focus on its core strengths while building capacity," said new Chromas President Neil Calhoun, who joined the company as part of the American Capital buyout. "We look forward to a productive relationship."
American Capital is a publicly traded buyout and mezzanine fund. American Capital is an equity partner in management and employee buyouts; invests in debt and equity of companies led by private equity firms, and provides capital directly to private and small public companies. American Capital funds growth, acquisitions and recapitalizations.
Companies interested in learning more about American Capital's flexible financing and ability to provide senior debt, subordinated debt and equity should contact Mark Opel, Principal, at (800) 248-9340, or visit our website.
Capital.com, Inc., a portfolio company of American Capital, is a business finance portal where premier financing sources compete to provide receivable and inventory financing, machinery and equipment loans and leasing, real estate and construction financing, subordinated debt and equity financing for growth, acquisitions, management buyouts, liquidity, recapitalizations, ESOP transactions and SBA loans. Companies in need of financing or information about financial services should contact Capital.com at info@Capital.com, or call (646) 935-1100.
This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The statements regarding expected results of American Capital Strategies are subject to various factors and uncertainties, including the uncertainties associated with the timing of transaction closings, changes in interest rates, availability of transactions, changes in regional or national economic conditions, or changes in the conditions of the industries in which American Capital has made investments.
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